Los Angeles — Small business owner Bobby Djavaheri is navigating tumultuous financial waters, wrestling with the consequences of rapidly changing tariffs on Chinese imports. Stockpiled within his Los Angeles warehouse are products he hopes won’t be swallowed by escalating costs tied to sky-high tariffs that threaten to cripple his livelihood.
The Burden of Unpredictable Tariffs
“I feel like my government isn’t supporting me or my business,” Djavaheri shared with CBS News. As the owner of Yedi Houseware Appliances, a company specializing in small kitchen gadgets like air fryers and rice cookers sourced entirely from China, he faces a unique and daunting challenge.
Financial Whiplash: From 145% to 30%
When Djavaheri’s latest shipment landed mere weeks ago, he was hit by a staggering 145% tariff imposed by President Trump on Chinese goods. The resulting duty tax bills from U.S. Customs ranged from $9,000 to $21,000, a stark contrast to the mere “couple hundred dollars” he previously spent on tariffs.
“In a low-margin business, this is a near-impossible situation,” Djavaheri lamented. However, following a recent truce between the United States and China, the tariff has been temporarily reduced to 30% for at least 90 days. But this reduction still poses significant costs, especially for high-end products. “We’ve had to raise prices across the board,” he noted, sounding the alarm for consumers and businesses alike.
Rushed Orders Amid Rising Costs
Now, as the holiday season approaches, Djavaheri finds himself frantically ordering inventory in hopes of keeping his business afloat. “Shipping prices have already tripled,” he added, painting a picture of a business landscape fraught with uncertainty.
Graphing the Dilemma: To Ship or Not to Ship
The chaotic state of the tariff system leaves many U.S. companies grappling with tough decisions. Should they pay more to ship goods at the current 30% rate, or hold out for the possibility of further tariff reductions? “The duties have created a massive cash outlay for businesses,” Ryan Petersen, CEO of Flexport, a logistics company assisting businesses with international trade, remarked to CBS News. “Many prefer to delay payment until they absolutely need the products.”
Flexport is witnessing a surge in demand for foreign trade zone facilities and bonded warehouses near ports and airports. These facilities allow companies to temporarily store cargo and postpone tariff payments until the goods are dispatched. “Both options defer duty payments until goods are transferred out,” Petersen explained.
The Financial Toll of Tariff Wars
For Djavaheri, the financial implications of the previous 145% tariff are a painful reality. “I will never recover that money,” he stated, underscoring the challenges that lay ahead. The financial whiplash leaves him without expectations for profit this year; survival has become the primary goal.
“We’re in the midst of a trade war,” he lamented, highlighting the escalating battles that small businesses like his are facing amidst changing policies.
